Paper #830
- Title:
- Modern perspectives on stabilization policies
- Author:
- Jordi GalÃ
- Date:
- October 2004 (Revised: August 2005)
- Abstract:
- The present paper describes recent research on two central themes of Keynes’ General Theory: (i) the social waste associated with recessions, and (ii) the effectiveness of fiscal policy as a stabilization tool. The paper also discusses some evidence on the extent to which fiscal policy has been used as a stabilizing tool in industrial economies over the past two decades.
- Keywords:
- business cycles, inefficient allocations, government spending multiplier, non-Ricardian households, countercyclical policies
- JEL codes:
- E32, E63
- Area of Research:
- Macroeconomics and International Economics
- Published in:
- CESifo Economic Studies, Vol. 51, 587-599, 4/2005
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